Finance
In Michigan, 'amortization' in a mortgage loan refers to:
AThe process of gradually paying down the loan balance through regular principal and interest payments✓ Correct
BAn increase in the loan balance over time
CThe lender's option to foreclose
DThe borrower's early payoff penalty
Explanation
Amortization is the gradual reduction of the outstanding loan balance through scheduled monthly payments that include both principal and interest. Early payments are mostly interest; later payments are mostly principal.
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